Bynum v. American Airlines Inc.

United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS February 6, 2006
FOR THE FIFTH CIRCUIT Charles R. Fulbruge III
Clerk
No. 04-20921
SAM BYNUM, Individually and on behalf of all
others similarly situated,
Plaintiff-Appellant,
versus
AMERICAN AIRLINES INC.; ET AL.,
Defendants,
AMERICAN AIRLINES INC.; CONTINENTAL AIRLINES INC.; DELTA
AIRLINES, INC.; NORTHWEST AIRLINES, INC.,
Defendants-Appellees,
versus
MARIAN ROSEN,
Appellant.
Appeal from the United States District Court for
the Southern District of Texas
(USDC No. 4:03-CV-518)
_________________________________________________________
Before REAVLEY, JOLLY and OWEN, Circuit Judges.
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PER CURIAM:*
We vacate and remand for the following reasons:
1. The district court held that Appellant’s lawsuit had no basis in fact or
law. It then imposed sanctions in the amount of $27,943.23 on Appellant and
his counsel jointly and severally.1 The district court did not specify pursuant
to which rule or power it was sanctioning the Appellant and his counsel.
Sanctions may rest on Federal Rule of Civil Procedure 11, 28 U.S.C.
§ 1927, or its inherent power. Mercury Air Group, Inc. v. Mansour, 237
F.3d 542, 548 (5th Cir. 2001) (Rule 11); Travelers Ins. Co. v. St. Jude Hosp.
of Kenner, La., Inc., 38 F.3d 1414, 1417-18 (5th Cir. 1994) (28 U.S.C. §
1927); Gonzalez v. Trinity Marine Group, Inc., 117 F.3d 894, 898 (5th Cir.
1997) (inherent authority). However, since the district court sanctioned the
party and counsel, and held them jointly and severally liable, the district court
could not have been acting under § 1927 because only the attorney, not the
client, may be sanctioned under § 1927. Magnum Oil Co. v. City of Houston,
*
Pursuant to 5TH CIR. R. 47.5, the Court has determined that this opinion
should not be published and is not precedent except under the limited circumstances
set forth in 5TH CIR. R. 47.5.4.
1
We note that the Appellees requested attorneys’ fees and costs as sanctions
against Appellant’s counsel, not Appellant. Nevertheless, the district court imposed
sanctions on both Appellant and his counsel.
2
143 F.3d 205, 208 (5th Cir. 1998). If the district court was acting under §
1927, it abused its discretion in awarding the sanctions.
Sanctions under Rule 11 may be appropriate if: (1) a document has
been presented for an improper purpose (Rule 11(b)(1)), (2) the claims or
defenses of the signer are not supported by existing law or by a good-faith
requirement for an extension or change in existing law (Rule 11(b)(2)), or (3)
the allegations and other factual contentions lack evidentiary support or are
unlikely to do so after a reasonable opportunity for investigation (Rule
11(b)(3)). First, we cannot glean from the district court’s oral statements that
a document was presented for an improper purpose under Rule 11(b)(1).
Further, the parties do not argue that Rule 11(b)(1) applies. Second,
monetary sanctions can be imposed against the attorney but not the client for
violations of Rule 11(b)(2). See FED. R. CIV. P. 11(c)(2)(A). Since the
district court sanctioned the party and counsel, the district court could not be
acting under Rule 11(b)(2). If the district court was acting under Rule
11(b)(2) (which it appears it was doing when it stated that Appellant’s claims
lacked legal merit), the district court abused its discretion by improperly
sanctioning both the party and counsel.
In his complaint, Appellant asserted two claims–violations of Title III
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of the Americans with Disabilities Act (ADA) and the Air Carrier Access Act
(ACAA). Appellant requested injunctive and declaratory relief under both
statutes seeking captions for in-flight movies and safety films. The district
court held that Appellant’s ADA claim had no basis in law because the ADA
specifically excludes airplanes from coverage. However, it is not clear (or
settled precedent, at least in this circuit) that airplanes are not covered by
Title III of the ADA. The district court did not cite a case in support of its
holding. The two cases cited by Appellees, Love v. Delta Airlines, 179 F.
Supp. 2d 1313, 1316 (M.D. Ala. 2001), rev’d on other grounds, 310 F.3d
1347 (11th Cir. 2002) and Access Now, Inc. v. Southwest Airlines Co., 385
F.3d 1324, 1332 (11th Cir. 2004), only held that airlines are not generally
covered by Title III of the ADA.
In the instant case, the district court also concluded that Appellant’s
ACAA claim failed because that statute includes no private right of action.
This holding is directly contrary to Fifth Circuit precedent. In Shinault v.
American Airlines, Inc., 936, F.2d 796, 800 (5th Cir. 1991), this court
specifically held that the ACAA provides a private right of action. Shinault
has not been overruled even though other circuits have reached a different
conclusion. The district court also held that enforcement of the ACAA lies
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solely with the Department of Transportation. This court held in Shinault that
the Department of Transportation has primary jurisdiction over claims for
injunctive relief under the ACAA. Id. at 805. In addition, this court stated:
“[o]ur unwillingness to hear Shinault’s claim for injunctive relief should not
be interposed as a blanket proscription on judicially issued injunctions under
the ACAA.” Id. Thus, the availability of injunctive relief under the ACAA is
far from settled in this circuit. Further, this court has not dealt with
declaratory relief under the ACAA. In sum, Appellant’s ADA and ACAA
claims were supported by existing law (or at the very least not directly
contrary to existing law so as to be frivolous).
We next turn to whether there was a violation of Rule 11(b)(3). It
appears that the district court did sanction the Appellant and his counsel
under Rule 11(b)(3) based on a lack of factual support for Appellant’s claims.
In granting summary judgment, the district court held that Appellant lacked
standing to sue because he failed to show that he had flown on an airplane
before he sued and that he lacks an injury. Prior to granting summary
judgment, the district court ordered Appellant to file a pleading listing all of
the airlines that he had flown since the effective date of the ADA, and
whether those flights were domestic or international. Appellant responded
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that he had flown domestic flights on American Airlines, Continental Airlines,
and Delta Airlines. He did not state he had flown on Northwest Airlines,
which he had named as a defendant, or that he had flown on any international
flights.2 The district court then ordered Appellant to list “what airlines he
flew on specific dates” for the six months prior to filing suit.3 Appellant
responded that he had flown domestically on Continental Airlines in January
2004 and on Delta Airlines in June 2004, after filing suit.
At the sanction hearing, Appellant testified:
Q: You are aware that you have sued nine different carriers in this
lawsuit?
A: Yes, ma’am.
Q: Have you flown on each and every one of those air carriers at
some point in time?
A: Yes.
He further testified that in the last four years he had flown to Hawaii,
Washington, D.C., Austin, Dallas, Las Vegas, Guadalajara, Mexico, and
2
We note that the Deutsche Lufthansa AG, Air France LLP, British Airways
PLC, and Virgin Atlantic Airways Ltd. (collectively “International Carriers”) chose
not to pursue attorneys’ fees. The four domestic carriers that sought attorneys’ fees
as sanctions were American Airlines, Delta Airlines, Continental Airlines, and
Northwest Airlines.
3
We are unsure as to why the district court requested this information for
only the six month period prior to the filing of the lawsuit.
6
Seattle. He could not recall the specifics of these flights, the exact dates and
which airlines he flew to each destination. He further testified that he
attempted to contact the airlines and that they were unable to provide him
with the information on the flights. He testified that he had discarded the
documentation on the flights. Appellant testified that his father paid for the
flights, but would not release the documents to him. He stated that he had
been diagnosed with psychosis and had trouble communicating with his
attorney. Appellant testified that he believed that in 2001 or 2002 he flew on
a Continental flight and questioned a stewardess if any accommodation could
be made because he could not listen to a movie.
We agree with the district court that Appellant’s lawsuit against the
airlines for which he had not flown lacked any basis in fact and that he lacked
standing to sue these airlines (Northwest Airlines and the International
Carriers). However, as for Continental Airlines, Delta Airlines, and
American Airlines, Appellant specifically listed these airlines as ones he had
flown since the effective date of the ADA. While Appellant or his counsel
did not have documentation supporting these flights prior to filing suit, the
standard certification for factual allegations under Rule 11(b)(3) is that there
is (or likely will be) evidentiary support for the allegation, not that the party
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will prevail with respect to its contention.
The district court admonished Appellant’s counsel that she should have a
factual basis or inquired into the factual basis before filing suit. Appellant’s
counsel admitted that she did not subpoena the records from the airlines, but
explained that the parties agreed to defer discovery until after ruling on the
motion to dismiss. Appellant’s counsel also stated she understood that
Appellant had flown the domestic carriers that were sued, but not the
International carriers. Thus, what we have here is clearly baseless claims
against Northwest Airlines and the International Carriers (those airlines he
had not flown), but not against Continental Airlines, Delta Airlines, and
American Airlines (the airlines that he had flown). Thus, the district court
abused its discretion in awarding sanctions to Continental Airlines, Delta
Airlines, and American Airlines; however, Northwest Airlines could be
entitled to sanctions.
We finally turn to the district court’s inherent power “to manage their
own affairs so as to achieve the orderly and expeditious disposition of cases.”
Gonzalez, 117 F.3d at 898 (internal quotation marks and citation omitted).
One aspect of this inherent power is the power to impose sanctions, including
attorneys’ fees, on litigants for conduct that is in bad faith, vexatious, wanton,
8
or undertaken for oppressive reasons. Chambers v. NASCO, Inc., 501 U.S.
32, 44-46, 111 S. Ct. 2123, 2132-33 (1991). The district court must make a
finding that the sanctioned party engaged in conduct that is tantamount to
“bad faith” before imposing sanctions pursuant to its inherent power. Elliott
v. Tilton, 64 F.3d 213, 217 (5th Cir. 1995).
Appellees claim that the district court made a finding that Appellant
and his counsel engaged in conduct tantamount to “bad faith” when it stated:
You have no facts. What you have done is when your
negotiation for a change in airline policy and practice would benefit
your client did not succeed, that you were unable to convince the
airlines that they should make these changes, then you sued them
for not making the changes.
It’s a free country and you are entitled to ask the airlines to
do whatever you want to, and if it is not compelled by law to do it,
you have no right to sue them for not doing what you want, what
you wish, what you prefer, what you think is better.
And even if you do sue them, you have to have the facts.
The client, Bynum, has to have the facts that meet the law. I didn’t
make the Disability Act, I didn’t make the federal aviation
regulation scheme, I didn’t make the Warsaw Convention, I just
apply the stuff.
But this is not a legislature, it is not a press conference.
What you did apparently is file a suit hoping that the existence of
the suit would pressure the airlines into doing something they were
not obliged to do at law, and what you could not convince them to
do as a matter of business practice.
* * *
But we have established a complicated and reasonably
effective, however difficult it is, system of limited airline
regulation. And that doesn’t include the claims that [Appellant]
9
can legitimately make because of his experiences, and those laws
do not include your opportunity to sue based on your feelings about
what the airlines ought to do. That is not what lawsuits are.
Appellees believe that these statements show “the district court
concluded the primary reason [Appellant and his counsel] filed this lawsuit
was to impose costs on the airlines so that the airlines would bend their policy
demand without evidentiary or legal support.” Appellees also contend that
Appellant’s counsel’s admission that she filed this action as an “advocacy
action” supports the district court’s finding of “bad faith.”4 Appellees rely on
Batson v. Neal Speke Assos., Inc., 805 F.2d 546, 550 (5th Cir. 1986) (quoting
Lipsig v. Nat’l Student Marketing Corp., 663 F.2d 178, 181 (D.C. Cir.
1980)) for the proposition that “advocacy simply for the sake of burdening an
opponent with unnecessary expenditures of time and effort clearly warrants
recompense for the extra outlays attributable thereto.” We question whether
4
At the sanction hearing, the following exchange between the Court and
Appellant’s counsel took place:
THE COURT: So, Ms. Rosen, is it fair to say that this is simply an
advocacy action?
MS. ROSEN: Yes, Your honor.
Your honor, may I say –
Rosen did not complete her response and the district court continued with its
remarks.
10
the necessary finding was made and whether it would be supported by the
record. As explained, the district court abused its discretion in finding that
certain facts to be unsupported and in finding that Appellant’s claims have no
support in the law.
2. In addition, the $27,943.23 sanction by the district is not supported by
proof of the incurred fees and expenses. The only evidence submitted by
Appellees in support of their request for fees and expenses as a sanction was
the affidavit of an attorney who in conclusory fashion stated that attorneys’
fees and costs incurred in connection with the defense of this matter totaled
$27,943.23. The affiant also stated that she believed that the “fees and costs
in this matter are reasonable and customary in Houston, Texas for this type of
case.” No supporting documentation, timesheets or otherwise, was attached
to the affidavit explaining the basis for the $27,943.23 in fees and costs.
Without supporting documentation, it is impossible to determine whether the
fees and costs were reasonable and, hence, whether the sanction based on the
fees and costs was reasonable. FED. R. CIV. P. 11(c)(2) (an award of attorney
fees and expenses to the opposing party must be “reasonable” in amount).
Accordingly, we VACATE the district court’s judgment and
REMAND for further order if in accord with this opinion.
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